In the US, residential electricity customers outnumber business customers by nearly 7:1. However businesses, including small-to-medium businesses (SMB) and commercial & industrial (C&I), will continue to have an outsized impact on progress towards our clean energy future due to their massive grid impact. The average business customer uses 11 times more electricity than an average household, presenting enormous decarbonization potential across energy efficiency, load flexibility, and building & vehicle electrification.
The non-residential sector in the US has a mind-blowing carbon footprint, emitting 2000+ MMT CO₂ equivalent each year, excluding transportation. To better illustrate this number, imagine over 5 trillion miles driven in a gas-powered car or the annual output of 519 coal-fired power plants.
The road to a decarbonized future must run through the business sector, but we won’t get there with business as usual. Current participation is low in today’s established utility energy efficiency programs, with just around one-third of businesses adopting common offers such as installing energy-efficient appliances or weatherizing their building.
The challenge lies in mobilizing businesses to take part in these programs. As the non-residential sector electrifies and drives even more load growth, the need for true partnership between utilities and businesses becomes even more important
Yet reaching businesses, particularly SMBs who often lack dedicated utility account management, is challenging. No two businesses are alike, with the segment including small mom-and-pop shops to large multi-site chains to industrial manufacturing facilities, and more in between. To make it even more complicated, within businesses of the same segment, they can have different hours, building types, energy needs, ownership type, etc. Business owners are typically stretched thin, leaving little time to interact with utilities.
The silver lining is that business customers are eager for collaboration, and utilities are ideally positioned to partner with them. Business customers are measurably more satisfied with their utility than residential customers (scoring 8.2 vs. 7.4 out of 10). They view their utility as a “trusted advisor” and are more likely to partner with them than any other ecosystem player. Utilities also have access to these businesses’ energy data and program offerings, enabling them to craft personalized clean energy journeys that benefit them.
The Missing Piece? Putting Business Customers First
We haven’t truly put these customers first by starting with a holistic picture of who they are and what they need. This means deeply understanding the end customer to engage and activate them. Too often we start with our own goals – “How do I get the customer into my program?” versus starting with the customer’s goals “How do I make sense of my energy bill? How can I save money on my bill without disrupting operations?” Or worse, we try to fit a square peg in a round hole by assuming residential solutions will meet business needs.
With the expertise of Uplight’s talented user research and design team, we set our preconceived notions aside and listened directly to business customers. Here are a few examples of what we learned:
- Direct peer comparisons (“you used more than peer restaurants”), a tried-and-true motivator for residential customers, are not as meaningful to business customers. Instead, trend peer comparisons (“you did better year-over-year than peer restaurants”) help businesses benchmark much more effectively.
- Business customers with multiple locations need an easy way to compare apples-to-apples data, such as usage per square foot, across their portfolio and see trends over time to understand where to focus their effort.
- Energy expenses represent a significant cost for budget-conscious business customers. They are more inclined to take action than residential customers, but require utilities to show a quick path to return on investment (ROI). Personalization combined with an individualized ROI is a recipe for success.
Customer-centric Experiences = Better Business and Decarbonization Outcomes
Ironically, starting with the customer doesn’t just drive exceptional customer experiences, but also key business outcomes for the utility. According to Forrester Research, every dollar invested in User Experience (UX) yields 100 dollars in return. It’s important to recognize that driving utility outcomes is not solely an education problem, it’s a behavior problem. At Uplight, we study the customer’s decision-making environment to design an experience that drives action. By improving the customer experience, we’ve seen utilities double the industry-standard engagement rates for energy efficiency program sign-ups, achieving their desired business outcomes. Taking this approach more and more will enable us to activate this critical segment at scale.
The icing on the cake: starting with the customer moves us faster toward our clean energy future. While the energy industry is often siloed – differentiating energy efficiency, electric vehicles, demand response, building electrification, and more – our business customers aim to better manage their energy and decarbonize holistically. By adopting the perspective of business customers, we can dismantle these silos and advance toward a clean energy future that benefits the utility, business customers, and the planet.
This post was originally published on here
